Payday loans are often advertised as a means of recovering from a financial emergency, and when used in this way they can indeed be a life saver. However, this leads one to ask what, exactly, constitutes a financial emergency. This is an important question to ask, as payday loans are expensive and can potentially put you in even more dire financial straits if not used wisely.

Thus, they should be used only when they must be used, with the aforementioned 'must' indicating a legitimate emergency. What a true emergency is may be relative to the situation at hand, but there are some characteristics that it should possess in order to count as such.

There are several forms that an emergency of this nature can take. The first is a situation wherein someone's health is at risk. If you or a loved one needs money immediately in order to cover medical costs, then you are faced with a valid reason for taking out a loan. Such a case is rarely applicable to humans, as hospitals will bill you after a medical emergency and usually offer a repayment plan for those who do not have insurance and cannot afford to pay the total costs in one lump sum.

However, for prescriptions and other such expenses, you will need to pay upfront, and it is in these situations that a payday loan will come in handy. Additionally, animal lovers may also have to withdraw a loan if their pet suffers an unexpected health issue, as veterinarians do not have the same 'No patient turned away' policy that hospitals do.

Another situation that will count as an emergency for the purposes of payday loans will be those in which one of your basic needs is affected. Such cases would include a potential eviction due to unpaid rent, a lack of groceries, or a possible loss of electricity or gas because of a late bill. These circumstances are even more urgent if they affect not only yourself but a loved one as well, such as kids or a spouse. In such predicaments, a payday loan is a warranted and welcomed solution to ensure that you and those who depend on you will keep their basic needs of food and shelter.

A final condition that constitutes a financial emergency which may necessitate a loan is when a situation arises that may hinder your ability to procure further funds in the future. For example, if you rely on you vehicle to get you to and from work in order to make money, then unexpected car troubles or a late car bill would count as an emergency for which a loan is more than warranted. This goes the same for anything that you use to earn a paycheck. If you use a cell phone, or work online and use a computer and the internet, a situation affecting the viability of said objects would constitute an emergency for which you would be justified in taking out a loan.

There are a variety of situations where a payday loan can help you get through tough times. By keeping in mind that such services should only be used for emergencies and questioning what counts as an emergency, you can ensure responsible borrowing practices, thus keeping you financially on track and out of debt.